Thousands of young entrepreneurs nowadays spend all their years of youth in paying their money dues, pulling themselves out of debt, and dwelling paycheck to paycheck. In fact, studies have found that the preponderance of today’s college graduates doesn’t expect to pay off their student loans until their 40’s!
Once that skimpy time period is over, making to the point in life where your business ventures actually begin to accrue wealth can be very exciting. However, this is also a time when you need to be very, very careful.
Money can open up a lot of doors but can also conceive a lot of problems.
Here are three larger things all young entrepreneurs should recognize as they generate money:
Don’t forget about yourself
One of the worst things young entrepreneurs can do is attach their livelihood to the success of their business. If the business goes south, your life can end up in shambles. Remember, YOU come first. Once you are at the point when you can cut yourself a salary, you need to start setting yourself up for the future.
Learn how to invest properly
As a business owner, investing your earnings may seem obvious. But, there are plenty of wrong ways to do it. For one, putting a huge chunk of your money into something without a firm understanding of its entirety is perhaps the biggest investment sin one can make.
Secondly, you do not want to put your assets at risk. You need to make sure to structure your business and investments in a way that creditors won’t have access to them should anything go wrong.
Third, investing too much at once can be troublesome. As a general rule of thumb, it’s recommended to stick to dedicate 80% of your resources to core business opportunities and 20% to new ones.
Start planning your will
Failing to do so can put your relatives in a tough situation in having to make those difficult choices for you. Keep in mind, your will doesn’t have to be permanent. You can always make alterations while you’re still alive. Once you start a family and have people who depend on you, writing up a will becomes even more important.